Stock X has a beta of 0.5 and Stock Y has a beta of 1.20. Which of the following statements must be true about these securities? (Assume the market is in equilibrium.)

a. The required return on Stock Y will be greater than that on Stock X. b. The required return on Stock X and Stock Y will be the same. c. Stock X would be a more desirable addition to a portfolio than Stock Y. d. When held in isolation, Stock Y has more risk than Stock X. e. Stock Y would be a more desirable addition to a portfolio than Stock X.